Section 820.516 - Capital stock(a) Credits.-- For tax years that begin on or after January 1, 1999, a corporation that is a qualified business under this act may claim a credit against the tax imposed by Article VI of the Tax Reform Code of 1971 for tax liability attributable to the capital employed within the subzone in the taxable year. For tax years that begin on or after January 1, 2001, a corporation that is a qualified business under this act may claim a credit against the tax imposed by Article VI of the Tax Reform Code of 1971 for tax liability attributable to the capital employed within the expansion subzone in the taxable year. For tax years that begin on or after January 1, 2004, a corporation which is a qualified business under this act may claim a credit against the tax imposed by Article VI of the Tax Reform Code of 1971 for tax liability attributable to the capital employed within the improvement subzone in the taxable year. No credit may be claimed for capital employed prior to designation of the real property as part of a subzone or expansion subzone. The business activity must be conducted directly by a corporation in the subzone or expansion subzone in order for the corporation to claim the tax credit.(b) Tax liability.--The corporation's tax liability attributable to capital employed within a subzone, improvement subzone or expansion subzone shall be determined by multiplying the corporation's taxable value attributable to capital employed within the subzone, improvement subzone or expansion subzone by the rate of tax imposed under Article VI of the Tax Reform Code of 1971 for the taxable year. The corporation shall compute its Pennsylvania taxable value in conformity with Article VI of the Tax Reform Code of 1971 with no adjustments or subtractions for the capital employed in the subzone, improvement subzone or expansion subzone.(c) Determination of attributable tax liability.--The determination of the corporation's taxable value attributable to the capital employed within a subzone, improvement subzone or expansion subzone shall be determined with specific reference to the following:(1) If the entire business of the corporation in this Commonwealth is transacted wholly within a subzone, improvement subzone or expansion subzone, the taxable value attributable to the capital employed within a subzone, improvement subzone or expansion subzone shall consist of the Pennsylvania taxable value as determined under Article VI of the Tax Reform Code of 1971.(2) If the entire business of the corporation in this Commonwealth is not wholly transacted within a subzone, improvement subzone or expansion subzone, the taxable value of a corporation in a subzone, improvement subzone or expansion subzone shall be determined upon such portion of the Pennsylvania taxable value attributable to the capital employed within the subzone, improvement subzone or expansion subzone by employing the apportionment factors set forth in section 515(d) . (d) Deleted by 2000, Dec. 20, P.L. 841, No. 119, § 4, imd. effective.(e) Limitation on amount of credit.--The credit allowed under this section shall not exceed the tax liability of the taxpayer under Article VI of the Tax Reform Code of 1971 for the tax year.(f) Credit not available.-- The following shall apply: (1) Any portion of the taxpayer's tax liability that is attributable to the capital employed in the operation of any of the following may not be used to calculate a credit under this section:(i) Any of the following that are required to use special apportionment under Article IV of the Tax Reform Code of 1971 or would be required to use special apportionment under Article IV of the Tax Reform Code of 1971 if the taxpayer had income from business activity taxable both within and without this Commonwealth: (A) A railroad, truck, bus or airline company.(B) A pipeline or natural gas company.(C) A water transportation company.(ii) A corporation that qualifies as a regulated investment company under Article IV of the Tax Reform Code of 1971.(iii) A holding company as defined in Article VI of the Tax Reform Code of 1971.(2) The prohibition under paragraph (1) shall not apply to the portion of a qualified business engaged in manufacturing or processing.Amended by P.L. 183 2012 No. 16, § 3, eff. 2/14/2012.1998, Oct. 6, P.L. 705, No. 92, § 516, imd. effective. Amended 2000, Dec. 20, P.L. 841, No. 119, § 4, imd. effective; 2002, Dec. 9, P.L. 1727, No. 217, § 6, imd. effective.